If you are active on social media, you’ve probably come across an “influencer”.
These are the larger-than-life fitness geeks, food lovers and comedians whose Instagram accounts boast hundreds of thousands, if not millions, of loyal followers. These micro-celebrities represent an era in which celebrity is democratized, and anyone with a smartphone can achieve Internet fame (and fortune) by creating a persona that is worthy of others’ attention.
As brands continue to recognize the power of influencers, many seek to partner with them to get their products into the hands of dedicated fans. But as a market in which followers and engagement can be bought, companies must not only conduct extensive due diligence on which influencers to pick, but also which ones to avoid.
Patrick Ip, founder of social media consulting firm Kip Solutions (acquired by New York based Post+Beam) and former business innovation lead at Google, recently launched his new venture, Unity Influence, to solve this problem with his co-founder Jacobo Lumbreras.
Unity influence proposes a machine learning approach to connect small businesses with the right influencers, and aims to make influencers more accessible to small business owners by charging a fee of $200 - compared to the $25,000 that some agencies charge.
I connected with Patrick to understand the latest developments in the growing field of influencer marketing, as well as the motivation behind founding Unity Influence.
What is influencer marketing?
Patrick: Celebrities influencing people’s purchase decisions have been around for a while. If you look at the progression of the influencer industry, it really started with “macro” influencers - people like Kim Kardashian.
In the past few years, there’s been a renaissance towards “micro” influencers, meaning people with 10,000 to 200,000 followers on social media platforms like Instagram.
What types of companies or brands should market through influencers?
Patrick: Pretty much any product that can be used by a person. I firmly believe that from a cost perspective, influencer marketing is one of the best, if not the best, ways for a company to tell its story.
Micro influencers provide a niche focus and hence are often more relatable. As a result, about 6-8% of the people who come across their online posts engage with them - much higher than the 2-3% engagement rate for more conventional macro influencers.
To put this in context, hitting a 1% engagement rate is already considered good on Google adwords.
How big is the influencer marketing industry - if you could call it an industry?
Patrick: It’s hard to put a number on it because influencer marketing can be applied across different sectors, but the Mary Meeker (KPCB Internet Trends 2017) report has some interesting stats on it!
Writer’s note: according to the 2017 Internet Trends Report from top venture capital firm KPCB, effective user-generated content can generate 6.9x higher engagement than brand generated content on Facebook. According to influencer marketing agency Mediakix, the influencer market size is around $1.6 billion. You can see how the number was extrapolated here.
How can AI be used to further influencer marketing, and what can it bring to the table that existing data analytics tools can’t?
Patrick: Within our space, AI is not something new. There are ventures that are using machine learning to project results for marketing with different influencers.
One pain point we’ve identified is that businesses both big and small don’t want more data. They don’t want to collect information from 100 Instagram accounts to see which one is right for them. They want to know how they can use data to make their lives simpler, not more complicated.
That’s why with us, companies only spend 4 minutes giving us some specific information about their business and the type of content they want.
Our goal is to use AI to then automate the process of matching businesses with the 7000 influencers we work with and limit the number of steps businesses themselves have to take.
What’s next for influencer marketing, and what’s Unity Influence’ role in it?
Looking back at digital advertising, I like to contextualize it into three waves.
The first wave was traditional ads, such as Google ads.
The second wave was native ads, which became more authentic and less intrusive, but it’s not scalable.
The third wave is what we’re working on - to make advertising more human through influencer marketing, but at the same time making it scalable for the first time through our platform for small businesses.
In the end, advertising is moving towards more authenticity and accessibility, and that’s where we see influencer marketing and Unity Influence headed towards.